Billions In Missing Treasuries Just Turned Up

In the week ended March 12, the Federal Reserve's custody
holdings of U.S. Treasuries plummeted by $104.5 billion, marking
what was far and away the single-largest weekly withdrawal on
record.

The massive drop
fueled speculation that Russia had moved a large portion of
its holdings out of the U.S. in order to avoid asset freezes from
impending financial sanctions.

Custody holdings have been falling in recent weeks and months as
central banks in emerging markets have been forced to liquidate
dollar assets in order to prop up their own currencies, which
have come under pressure, but the size of the move seemed far too
large to be explained by such activity.

The Fed just reported custody
holdings data for the week ended March 19, and the numbers
are sure to add to the confusion.

As the chart shows, custody holdings increased by $32.3 billion
this week.